therefore you need balance. Personal balance of is hard to achieve therefore government helps with policies
zweicents 发表评论于
The key is do you need to pay rent if you don't own? The cost of renting and owning is pretty close in north america. That's why lots people buy. Compare to europe, majority just rent, due to the high housing price and less land for new developement.
xxc 发表评论于
回复jimgurr的评论:
the key is not what time you buy and what time you want to pay off. the key is housing is never a good investment in the last few years. and housing price was pop up by the government. put it this way, would you rather buy at lower price but with higher interest rate, or buy at higher price but with lower interest rate. if you asked me to go back to 1995, since I know what happened already, I would not buy house in 1995, I would buy stock and sell all my stock in the beginning of 2000. well, maybe that is not a good one, but, we have a long time bull market in housing and stock from 1980 to 2000 (housing to 2005). to my view, these two bull market is over. next bull is commodities.
there is an opportunity cost. The American lady might have done many other things in her life by borrowing money. The Chinese lady with the same argument might have missed much. By the time she is ready to enjoy the house, she' might not be able to enjoying....
Also borrowing and over borrowing are two different things.
you guy all make an assumption that house price will always go up. be realistic, that is inflation. you buy a house in 2002, how much is it now. the same year, you buy gold, how much is it now? which one go up faster? it is just inflation that make home owner look better, not that the house price increase, when the time house price increase, everything increase. look at gas from 2002 to 2007. and look at your income from the same time period.
I think your assumption is based on the value of the real estate with very low increasing rate.
In the SF bay area, I brought a half mil house 13 years ago. I had 15 yr fix rate loan. I will pay totally around 1 mil when the time I pay off in a few years. The house is worth 1 mil now. I don't believe any family can save 1 mil in 15 years with household annual income around $250,000 to $350,000 (this is the average for double income family in this area).